The Texas Civil Justice League, U.S. Chamber of Commerce Institute for Legal Reform, and Lawyers for Civil Justice jointly urge the Texas Supreme Court Advisory Committee to adopt a mandatory disclosure rule for third-party litigation funding (TPLF) arrangements in all Texas civil cases. Their letter highlights the rapid growth of TPLF, the lack of transparency in current practices, and the need for disclosure to ensure fairness, ethical conduct, and informed settlement negotiations within the civil justice system.
The organizations refute claims from the International Legal Finance Association (ILFA) that disclosure is unnecessary or harmful, providing evidence that funders often exert significant control over litigation strategy and settlement decisions. They cite recent legal disputes and federal court orders that reveal the influence of funders and emphasize that uniform disclosure rules would help judges and litigants accurately assess the impact of TPLF on cases, reducing the risk of manipulation and conflicts of interest.
The letter also addresses broader concerns, including the potential for foreign actors to use TPLF to influence U.S. litigation and access sensitive information, as well as the need to clarify that disclosure requirements would not infringe on attorney work-product protections or free speech rights. Ultimately, the authors advocate for Texas to follow other states in enacting clear, statewide rules to bring transparency and accountability to third-party litigation funding.
